Why Facebook and Social Media are Valuable for Your Small Business

So, you’ve finally started using social media platforms like Facebook and Twitter as marketing tools for your business. You’ve started interacting with customers online, are getting Facebook “likes” and are even getting new “Twitter followers” on a daily basis.

But, are you truly seeing any results from all of your online efforts? Is all of the work really worth it?

According to new research and data from the University of Buffalo, Texas A&M University and Aalto University in Finland, social media can in fact make a difference. The new study, published in the journal Information Systems Research, shows that customers who are also Facebook fans of the business are more valuable than customers without any online interaction with the company.

And this means much more than simply getting customers in the door. These customers that also interact with a business through Facebook, Twitter and other social media outlets also improve the company’s sales. In fact, the study’s lead author and assistant professor of marketing at Aalto University said these customers who interact with the business through social media contribute 5.6 percent more revenue than customers not active on social media. Additionally, these social medial-savvy customers visit the business five percent more than their non-social media counterparts.

The numbers don’t stop there. According to the social media marketing firm Syncapse, a Facebook fan is worth $174 to a brand. This amount is 28 percent higher than it was three years ago.

Syncapse reached this number thanks to a survey by research firm Hotspex, who collected data from more than 2,000 U.S. panelists earlier this year. The study compared Facebook fans and non-fans’ brand loyalty, media value, potential to recommend the brand to others and a number of other factors. The results were released earlier this week.

So now that we know social media has some influence as far as attracting customers, improving sales and getting them to return, there are a number of trends small business owners should know about and implement in order to have success with social media.

Be Specific

It seems like a new social network is introduced everyday, but that doesn’t necessarily mean your business needs to be on every single one. A number of small business and social medial experts believe 2013 is the year small businesses focus on one or two social media sources that work best for their specific product or service.

By investing time in the platform you believe is best for your customers — whether it be Facebook, Twitter or Instagram — small businesses can maximize their social media marketing efforts and hopefully have the greatest chances of increasing clientele and profit.

According to Ben Bentzin, an expert in brand development, product marketing and social media at the University of Texas at Austin, business owners have to think about what their customers are using as far as social media.

“If you are selling insurance to senior citizens, social media [like Twitter] may not be that important,” Bentzin said. “But if you are selling to college students, you have to have that social media presence.”

Additional Social Media Strategies

Apart from focusing your social medial efforts toward one or two platforms tailored to your customers, small businesses can also improve their social media campaign by:

Encouraging interaction from customers

Investing in building online communities over time as opposed to a quick-fix solution

Contributing regularly to your chosen social media platforms

Keeping customers up-to-date on events or sales

Like any marketing technique, it is important to have a specific strategy and plan from the beginning. Experiment with different social media platforms to learn which is best for your business and start taking advantage of these online communities.